The Value of People

by Kent Aitken

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Editors have figured out that there's more going on in documents than people can adequately, reliably process all at once. The standard practice is to take multiple passes, each time looking through a different lens. I was taught to take three cracks at important documents:

1. one for logic, coherence, and ideas
2. one for conciseness and the removal of extra words that add no meaning
3. one for spelling, grammar, and punctuation

The field of business administration teaches something similar, providing frameworks and guidance for how to think about problems: SWOT analyses, risk matrices, etc. My first manager looked at every new problem through the below framework, thinking about the needs and constraints from each lens:

The decision-making lens I tend to advocate for is the more humanistic one: starting from a position of trust, looking for positive-sum outcomes, and appreciating soft and long-term benefits from actions. But in actuality, there is a different lens I would make mandatory for every decision, ever. It would be taking a moment to go completely cold, rational, and economical, and to think of the people within organizations as dollar figures. Just for a moment.


If You Like It Then You Shoulda Put a Value On It

Statscan put yearly salaries for professional/knowledge worker jobs around $62,000 in 2014. Between benefits and pensions I think I can conservatively put the total compensation cost at $80,000 as a working estimate*. 

Some examples in which this lens may be enlightening:

• Consider a productivity-enhancing piece of technology with a price tag of $400. If you get a 0.5% productivity increase, it pays for itself in a year. If it lasts for a few years, you can get away with a 0.16% productivity boost, or, a few minutes per week. To say nothing of the fact that an open mind towards such investments may keep employees around longer, when losing such an employee costs $16,000 in lost productivity (which is the lowest figure I've encountered for turnover costs).

• If you're responsible for convening a working team or meeting, try occasionally working out the labour hours involved. Ten people for two hours is half a week's work: at $80,000/year, about $750. This isn't to say you shouldn't do it; rather, that you should consider what level of planning and communication on your part respects that investment.

• I've used this example before, but the IRS provoked a scandal for $50M in conference spending between 2010 and 2012. But divided over the three years and approximately 100,000 staff, it's $166/employee. The real question is how much their employees are worth, and whether that spending made them at least a half a percent or so more effective. Triangulating a few different sources (average HR costs for companies relative to budget**, my compensation cost estimate), the low end of the range is likely ~$4,000,000,000 worth of annual investment in people. The IRS has a ~$11,800,000,000 budget, and $50M is a pittance of their people cost.

• Lastly, consider a manager with half a dozen staff. We rarely consider the idea that they're responsible for almost half a million dollars in annual investment. And that $500,000 machine's performance can easily vary by ~20%, depending on how it is managed.

One Lens

It is easy to view human resources as sunk costs: past expenditures that should have no bearing on present decision making. It is not so. We should be building decision frameworks that encourage us to consider our stewardship role for the people behind organizations - at least for a moment, as one lens of several. Then taking other passes over problems, with other lenses. Editors give documents this level of respect.

TL;DR: discussions about people and spending need denominators.

*This assumes that the average employee creates at least their compensation cost in value to the organization. In actuality, in any sustainably profitable business the average value created must be greater than their compensation cost, and so these examples would be shorting employee value.

**For the Canadian public service, it's 38.1%.

Loyalling Implementing the Idea of Fearless Advice

by Kent Aitken

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Here's my entire hand for this post, laid on the table: the idea of Fearless Advice, Loyal Implementation makes me deeply uncomfortable.

The idea is that public servants provide advice, elected officials make a decision, and public servants then implement that decision, regardless of whether or not they agree (Nick has written in the past that the principle "isn't reserved for ministerial briefings" and applies throughout the public sector). It stems from this section of the Values and Ethics Code for the Public Sector:

1.2 Loyally carrying out the lawful decisions of their leaders and supporting ministers in their accountability to Parliament and Canadians.
1.3 Providing decision makers with all the information, analysis and advice they need, always striving to be open, candid and impartial.

However, the pithier version is well-entrenched in the minds of public servants. The phrase comes up everywhere, from office hallways to speeches from the Clerk of the Privy Council. However, compared to the source material, we've changed the order. But the real problem is that we think there is an order in the first place.


Theory and Practice

To be clear, I have zero issue with either of those two provisions. In fact, without them, the whole thing falls apart. Legitimately elected representatives make decisions based on the democratic logic that our system provides adequate information flows, contains sufficient checks and balances, and affords the opportunity to balance short- and long-term needs, regional and demographic demands, and public sentiment with substantive evidence.

However, the idea that fearless advice stops when loyal implementation starts is dangerous, and seems all too common ("they're sequential", I heard recently). We revisit the foundations for every policy and program eventually; when does a decision "end"? If new information comes available that impacts future actions, the past decision is a sunk cost, to be disregarded in weighing current options.


Fearless Advice and the Management Zeitgeist

The language that fills discussions about the future of the public service is of agility, continuous learning, and innovation - continuously exploring the adjacent possible of the new scenarios we enter (see: Where Good Ideas Go To Live And/Or Die):

• 8th Annual Report of the Prime Minister's Advisory Committee on the Public Service
• Twenty-First Annual Report to the Prime Minister on the Public Service of Canada
• Destination 2020

Recent decisions are not exempt from lessons learned, iteration, and improvement, and as such should not be exempt from fearless advice. It's in the implementation that we learn many of the truths about a decision's impact.


Misplaced Confidence

The other issue with the sequential approach for advice and implementation is the degree of confidence that it places in our ability to communicate and decide.

We can write advice amazingly precisely and thoughtfully, but unlike a conversation cannot correct misconceptions when we see them in others' facial expressions and body language, which we all do daily. Anyone that has ever re-drafted their own writing knows it never gets to perfect.

.@oao21 Q:Ever write crap and know you're writing crap? A: Pretty much every first draft. Q: What'd you do about it? A: A second draft.
— Rick Riordan (@camphalfblood) February 7, 2014

And if we are delivering advice in person? In practice, all conversations are first drafts.

Or, one could point to the evidence that willpower is a depletable resource. Or that hearing about large sums of money affects our judgement about money. Or that people are still biased towards certain names. Or that being reminded of negative stereotypes hurts people's test performance. Or that being tired impairs our judgement as much as alcohol. Regardless, we have quirks. We can reasonably rely on people to be effective decision-makers. But we can't rely on them to be effective decision-makers at every moment, and as such shouldn't shut the door on fearless advice once given.


The Rudder Straight

This is all perfectly consistent with the Values and Ethics Code, adhering to both provisions. It's urging a course change, while dutifully keeping the rudder straight. It's when we stop urging that the system falls apart.